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And though some offerings in this cloud-based productivity suite, such as Lync and SharePoint, aren’t ready for corporate use, big improvements over its predecessor, Business Productivity Online Service (BPOS), are evident.

“Microsoft took the promise of BPOS, which was sort of a skunkworks project with stability problems and a limited scope of success … and incredibly improved availability and uptime,” said Wes Miller, an analyst with Directions on Microsoft, an independent analysis firm based in Kirkland, Wash.

Microsoft took the promise of BPOS -- which was sort of a skunkworks project with stability problems…and incredibly improved availability and uptime.

Wes Miller, Directions on Microsoft

There have been blips though. Shortly after Microsoft launched Office 365, it made the news for two major outages that took down corporate customer email. Microsoft addressed the outages and accelerated its improvement schedule with the goal of making it an enterprise-ready platform.

Microsoft recently boasted that it has added 30 new featuresand improvements toOffice 365 and publicized its customers -- including Campbell Soup Co., Groupe Marie-Claire and Underwriters Laboratories Inc. -- to prove that its services have some mainstream appeal in the enterprise.

Some big new features include Lync for Mac support, SharePoint Business Connectivity Services (BCS) and the ability to access and update documents in SharePoint using Windows Phone 7.5.

Miller said that while the Exchange Online portion of Office 365 is enterprise ready, SharePoint Online makes it difficult to use some important capabilities, such as business connectivity. “There are things you can’t do with SharePoint Online yet,” Miller said. Lync, he said, still has limitations.

But Office 365 is young, and Microsoft has substantially improved its performance and usability. “Each time Microsoft updates Office 365, it gets closer to what you can do with on-premises versions,” Miller said.

The Office 365 experience Early adopters such as Underwriters Laboratories Inc. (UL) can vouch for the email benefits of Office 365.

UL is a 117-year-old global safety certification company based in Northbrook, Ill. It has 68 facilities and 120 inspection centers worldwide serving 95,000 customers. The company plans for aggressive growth through acquisition, which requires upgrading to flexible platforms that support expansion, said Christian Anschuetz, CIO of UL.

The company’s old mail platform was IBM Lotus Notes and Domino, with servers on premises worldwide. But functionality lagged in the platform, and about 90% of UL’s user base relies on Microsoft at home.

“The feedback they gave us was, ‘When I step into the workplace, I feel like I am stepping back in time,’” Anschuetz said.

With that, it was time to move forward. UL evaluated email offerings, including Google Docs, but ultimately chose Microsoft software because that’s what its end users are familiar with.

Anschuetz and his team considered traditional premises-based Exchange Server 2010 and SharePoint Server 2010, but the scale was tipped in favor of using services because the ramp up time would be quicker. The company ultimately chose Office 365 for email and on-premises SharePoint Server, which it plans to eventually move to the cloud.

Even though IBM systems and applications are deeply baked into UL’s culture, migration to Microsoft Office 365 was straightforward. The company rolled out Office 365 to its global population -- including huge operations centers -- within just eight weeks. There were some integration challenges but no disruption to business, Anschuetz said.

The Office 365 experience wasn’t completely without incident. The outages did disrupt business after the initial rollout, and although those occurrences had a small impact, they were still unacceptable to UL.

But, he understands that using new technology often involves some growing pains and considers it the price that early adopters pay.

“If this is a sign of what’s to come, we will have a problem,” he said. “But Microsoft’s response has been quite good, and they have been good about remediating.”

Overall, the flexibility and relative simplicity has made the switch to Office 365 worthwhile. For example, UL recently acquired a 2,000-person organization that ran a non-enterprise email platform. UL’s IT team added its new employees to Office 365 within two weeks -- fast, compared to the time required for premises-based projects.

“[Office 365] lets us focus on business rather than on infrastructure,” Anschuetz said.

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